NY Judge Overseeing New York AG Lawsuit Finds Trump Committed Fraud
Photo by Matt Johnson from Omaha, Nebraska, United States, CC BY 2.0
The judge who will be overseeing the bench trial of Donald Trump and his companies as related to the lawsuit filed by New York AG Letitia James has ruled that Trump’s company’s committeed fraud, sanctioned his attorneys, and narrows the scope of what has to be proved in the upcoming proceedings.
You can read the ruling for yourself here:
A judge overseeing a $250 million lawsuit against Donald Trump ruled the former president and his company committed fraud by inflating his net worth in business transactions, narrowing the scope of what the state’s attorney general must prove at an upcoming civil trial.
New York Supreme Court Justice Arthur Engoron also ordered the cancellation of Trump business certificates and imposed sanctions on attorneys representing him, two of his adult children, two other company executives and the business for repeating arguments that failed multiple times previously and were called “borderline frivolous.”
The judge’s ruling represents a significant setback for Trump by revoking his company’s authority to do business in New York, where the Trump Organization is headquartered and where Trump has major real estate interests. It also represents a victory for Attorney General Letitia James (D), who had asked that Engoron simplify the upcoming trial by deciding in advance that fraud was broadly committed so the state would need to prove only specific illegal acts.
Trump and his attorneys have denied any wrongdoing. Trump spokeswoman Alina Habba said the judge’s ruling Tuesday would be appealed.
Five Trump attorneys have been ordered to pay $7,500 each to a state organization that reimburses clients whose attorneys misused funds. One of the attorneys sanctioned by Engoron is Christopher Kise, a former Florida solicitor general who also represents Trump in federal court there in the indictment over the retention and mishandling of classified documents.
The decision orders the parties to suggest candidates for receivers who will oversee the dissolution of the various entities that make up the Trump Organization’s corporate structure — a ruling that appears to mean the collapse of its operations in New York.
Kise issued a statement on behalf of the defense team calling the decision “outrageous” and “completely disconnected from the facts and governing law.”
“Without even conducting a trial, the Court substituted its own judgment for that of nationally recognized experts from the NYU Stern School of Business and beyond,” Kise said. “More importantly, the Court disregarded the viewpoint of those actually involved in the loan transactions who testified that there was nothing misleading, there was no fraud, and the transactions were all highly profitable.”
James filed a lawsuit against Trump and his company last year alleging that the Trump Organization and its executives defrauded lenders and insurance companies from 2011 to 2021 by inflating Trump’s net worth in business transactions.
By manipulating the value of Trump’s property and other real estate assets by up to $2.2 billion annually, the real estate, hospitality and golf resort company obtained better interest and policy rates than it otherwise would have, according to the lawsuit.
Trump is expected to stand trial along with his sons Donald Trump Jr. and Eric Trump, who served as executives, longtime finance chief Allen Weisselberg and long-serving comptroller Jeffrey McConney.
The trial is scheduled to begin Monday but could be postponed because of an ongoing appellate court issue. It is unclear whether Tuesday’s decision will change the schedule.
Expect an onslaught of Hunter Biden stories to spew from the usual sources.Report
Wouldn’t “Fraud” invoke the 14th at this point?
Like, we’re past “presumption of innocence”, right?Report
1. No.
2. There is no “presumption of innocence” in a civil case.Report
He has been found in a court of law to have committed fraud.
Isn’t that, like, indelible (excepting an appeal, I suppose)?Report
No, this was a civil suit and it was decided on summary judgment. The Attorney General put forward a motion that presented evidence which basically stated “there is no question of material fact on these issues.” Meaning, all the evidence exchanged between the parties and available to the parties indicates that Trump and/or his organization committed fraud. There is no way for a reasonable trier of fact to look at the evidence and decide otherwise. Trump and his org had the opportunity to oppose the motion and present its own evidence that states there is a dispute of material fact that reasonable people can disagree on. The judge disagreed with whatever opposition was filed and whatever evidence Trump tried to muster was not enough.
Or are you going to go trolling for Trump to own the libz?Report
I’m hammering out exactly what happened. He was not found “Guilty” of Fraud, just “Liable” for it?
And, like, that’s On The Record now. Barring an appeal, of course?Report
He wasn’t even found liable. There was partial summary judgment on one issue, which lessens the amount that the AG needs to prove at trial. I haven’t read the full decision yet, but from the excerpts in the article this seems ripe for an appeal – summary judgment motions are supposed to be decided in the light most favorable to the non-movant, and if there’s ANY question of fact, the motion is supposed to be denied. Will update this comment after I read the decision.Report
“Indelible” is not a legally interesting term. What part of the 14th amendment do you think addresses former Presidents who committed fraud in their private business and what should be done about it?Report
Sorry, I was thinking “Article II, Section 4”.
“The President, Vice President and all civil Officers of the United States, shall be removed from Office on Impeachment for, and Conviction of, Treason, Bribery, or other high Crimes and Misdemeanors.”
If he was officially found Guilty of Fraud by summary judgment, I was wondering if this would officially qualify as a conviction.
But it’s civil and not criminal and he wasn’t even found guilty, just liable and it needs to follow impeachment rather than merely a court of regular old law anyway.Report
That section authorizes: (1) removal of a President who has been (2) impeached and (3) convicted of (4) treason, bribery, or other high crimes and misdemeanors. It has nothing to say about the eligibility of a candidate who has committed civil frauds in his non-presidential life.Report
Apparently we needed the Sainted Founders to spell out what High Crimes and Misdemeanors are for their time and for the entire future of the US.
Being fouind liable for massive fraud and also sexual assault should be enough too trigger the HC and M thing but not for some.Report
You stupid layman! Only a pro-Trump troll would conclude something like that!Report
Ahhh…..urm….????Report
You’ve opened up a real can of worms here. Nobody knows the answer to this question, and views run from Gerald Ford’s view that an impeachable offense is whatever Congress says it is to it has to be a specific (and serious) crime.
Here’s a fun thought. Eugene Debs pulled nearly a million votes while sitting in a prison cell after having been convicted under the Espionage Act of 1917. Suppose he had pulled enough to win. Would he have been ineligible to serve as President? Could he have been impeached and removed soon after taking office?Report
The problem is we have to figure out the answer w/o help from the decayed corpses of the founders. How can we figure something out w/o the words of guys who have been dead for a couple hundred years.Report
There are people who think they can do this and — the gods preserve us — think they have actual working theories of how. Give me an unpretentious hack who knows what he doesn’t know any day.Report
Just wait until we get into the “shall be” vs. “will be” legal arguments….Report
Oh i’m ready and preped to run screaming from that discussion.Report
Who was defrauded?
“More importantly, the Court disregarded the viewpoint of those actually involved in the loan transactions who testified that there was nothing misleading, there was no fraud, and the transactions were all highly profitable.”
Did the insurance companies sue? It’s implied that he got better rates… I believe it. What’s the math on the better rates as paying less per unit on more units is usually a wash or worse (e.g. you pay $0.08 on $100, but $0.06 on $200) — unless you actually cash in on inflated values — which would then have a victim and a crime. Was there such an event?
Reminds me of the various accounting fictions that our entire economy is based on… like colleges (from a recent report from AEI):
“The gap between notional and real revenues has made a mess of college tax filings, too. To use the Beloit example, the college reports its revenues as though every student pays full tuition. In 2019, Beloit reported about $75 million in total revenue on its IRS Form 990, even though $35 million of that money was never asked for and never paid. To fill the gap between fantasy and reality, Beloit’s Form 990 reports “Grants and similar amounts paid: [$]35,469,256.” To be clear, Beloit never had $75 million in revenue; that number is an accounting fiction derived from the school’s published tuition, which is based on nothing whatsoever. Beloit also did not “pay” $35 million in grants and similar amounts: It simply marked down a price that was never real.”
Me: To be clear, loans or grants that students received to pay the remainder *are* the income the college received. The ‘Markdown’ is funded with internal ‘grants’ that are entirely ‘fiat’ in that they are created as they are created and constitute a discount, not a transfer of internal funds. This happens at every college I know S/M/L. It has a lot of distortionary effects, and probably should be ‘illegal’.
I’m perfectly willing to believe that lying and fraud are endemic to Trump and the entire program of NYC land development; is this Case #1 of cleaning up all the fraud in NYC? I hope so. But I suspect not.
My position, to avoid misconstruelization, is that I’m sure this sort of ‘fraud’ occurred… but I’m genuinely confused as to whether we think it is unique to Trump and if it’s not — and there’s no entity that loaned Trump money or insured his assets that’s bringing the case (is there?) — then how is this not basically an indictment of BAU in NYC and who’s next in the clean-up?Report
You can’t judge the entire business community for the actions of a few sick and perverted individuals.
For if you do, shouldn’t we blame the entire capitalist system?
And if you blame the entire capitalist system, isn’t this an indictment of the entire American way of life?
I put it to you,- Isn’t this an indictment of our entire American society?
Well, you can do what you want- but I’m not going to sit here and listen to you bad-mouth the United States of America!
https://www.youtube.com/watch?v=ROxvT8KKdFwReport
Dude! That’s what I’m asking… you can’t outflank me on reforming the system… are we finally cleaning Fraternity Row of all their shenanigans or do we just hate Delta House so much we’re willing to use the law but not enforce the law?Report
Unfortunately I think we all know the answer is ‘no.’Report
I’m actually more fascinated by the whole receivership/liquidation thing. The conventional wisdom when Trump won in 2016 was that putting his business into a blind trust was at least impractical because of the interlocking LLC structure and the number of places where what he brought was his name and personal recognition. Also that unwinding it cleanly and obtaining the maximum value for the illiquid assets might take a decade.Report
The appeals court slapped down Trump’s proceeding against Justice Engoron:
https://apnews.com/article/donald-trump-letitia-james-fraud-trial-new-york-d8934da24e78ca0cedab7303efdf48bdReport